Pentagon Employee Gets 3 Years in Prison

DALLAS (CN) – A former Army and Air Force Exchange Service official was sentenced to 3 years in prison for bribery and conspiracy in a multimillion-dollar telecommunications contract, and for not reporting the bribes on his income tax.

Henry Lee Holloway, 42, of Hamilton, Ga., worked as an AAFES general store manager at the Central Exchange in South Korea from 2003 through 2007. Funded by the Pentagon, the AAFES provides merchandise and services to U.S. military personnel at base and post exchanges worldwide. Holloway admitted that from May 2003 until April 2005 he conspired with, among others, Gi-Hwan Jeong, the CEO of Samsung Rental Co., using his official position to maintain Samsung’s $206 million contract to provide telecommunications services to U.S. military installations in South Korea. Prosecutors say Holloway admitted that in exchange for at least $70,000 worth of stock, entertainment, travel expenses, cash and other things of value from Jeong, he took official action to protect SSRT and further its interests, despite Holloway’s knowledge and belief that SSRT was underperforming and violating the terms of its contract with AAFES. According to court documents, before Jeong’s payments to Holloway, and as a result of Samsung’s failures to perform, Holloway sought to terminate the contract. Holloway admitted that after the bribes began, and as a result of the bribes, he used official acts and influence to support and expand that contractual relationship. In June 2009, Jeong pleaded guilty in Dallas Federal Court to a five-count superseding indictment, charging him with two counts of bribery, two counts of honest services wire fraud and one count of conspiracy. U.S. District Judge Ed Kinkeade sentenced Jeong in November to 5 years in prison and a $50,000 fine. Holloway was sentenced last week in Federal Court in Columbus, Ga. In addition to prison, U.S. District Judge Clay D. Land ordered him to pay a $5,000 fine and to forfeit $70,000. Holloway pleaded guilty in April 2009, to a two-count information, charging him with one count of conspiracy and one count of making a false statement on a federal income tax return.